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Rationale behind IPO underpricing: evidence from Asian REIT IPOs

Ooi, Joseph T.L. and Mori, Masaki and Wong, Woei Chyuan (2018) Rationale behind IPO underpricing: evidence from Asian REIT IPOs. Real Estate Economics, 47 (1). pp. 104-137. ISSN 10808620

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This article examines the rationale behind IPO underpricing using a sample of REIT IPOs in Asia. Although the IPOs registered an average initial return of 3.08%, the issuers were able to sell the IPO shares above their fundamental values by timing the listings in periods when existing REIT stocks are traded at a premium to their net asset values (NAV). An IPO could therefore be underpriced and yet produce a net gain for the issuer. The issuers’ net gain from IPO is, however, negatively related to long‐run performance of REIT IPOs.

Item Type: Article
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: School of Economics, Finance & Banking
Depositing User: Mrs. Norazmilah Yaakub
Date Deposited: 24 Feb 2019 02:04
Last Modified: 24 Feb 2019 02:04
URI: http://repo.uum.edu.my/id/eprint/25636

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